Trade Secrets Flashcards
What is the common law test for whether you can take action against someone for disclosing confidential information?
Coco v Clark:
1. The information must have the necessary quality of confidence.
2. The informaiton must have been disclosed in circumstances importing an obligation of confidence. (Objective standard - would the reasonable receipient have known it was confidential?)
3. The recipient must have breached that obligation to the detriment of the communicator.
What is the definition of a trade secret according to the Trade Secrets Regulations?
Information which
(a) is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among, or readily accessible to, persons within the circles that normally deal with the kind of information in question;
(b) has commercial value because it is secret; and
(c) has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret.
Can a third party disclose a trade secret which was revealed to them?
The Trade Secret Regulations prohibit third parties from acquiring, using or disclosing a trade secret obtained from another person when they know or ought to have known that the trade secret was acquired unlawfully. A similar principle exists in common law.
But NB trade secrets are not property. It’s not like patents where people are not allowed to infringe period. The third party has to know that the trade secret was acquired unlawfully.
What is a springboard injunction?
Springboard injunctions prevent an employee or former employee from using information to gain an unfair advantage.
This applies if the employee obtained confidential information unlawfully or if he is made unlawful use of it, for example by disclosing it to his new company when he changes jobs.
A springboard injunction stops the employee or his new company from gaining an unfair advantage over the original employer, even if the information is no longer secret. The court can decide the time and details of the injunction.
Summarise the rules on employer-employee confidentiality.
Faccenda Chicken v Fowler
Employees have a duty of fidelity to act in good faith towards their employer. This also means not disclosing confidential information. This duty is an implied term of the employment contract.
That duty will be broken if the employee copies or deliberately memorises confidential information for use after his employment ends.
Once employment ends, the implied duty is a lot more restricted. The employee still cannot disclose trade secrets, but there are no restrictions on him exercising or disclosing anything form his general skill, general knowledge or his general experience.
